Getting Your Federal Tax Lien Released
Nothing's worse than paying off your federal debt, only to discover that any Federal
Tax Liens against your property have not been released. This can not only damage
your credit, making it nearly impossible to get a mortgage, buy a car, or obtain
a student loan, it can limit your access to selling any of your personal property
or real estate.
Federal Tax Liens are serious business. They are levied upon all of your current
(and future) property when you fail to pay your annual IRS tax bill. They remain
intact until your tax debt (including all interest and penalties), are paid
in full.
In order to have a federal tax lien released, you must first obtain your current
payoff amount. A matter of public record, you can obtain a formal letter stating
the amount by contacting an IRS agent at 1-800-913-6050 and asking for a payoff
amount. Once the amount has been given to you over the phone, a letter will
also be sent as proof of the total.
If you are giving up ownership of your liened property (such as when you sell
your home), you may also apply for a Certificate of Discharge, which will allow
the sale to go through on a single piece of property.
Once the lien debt has been satisfied, you can file a Request for Release of
Federal Tax Lien with the IRS. Failure to do so may result in the lien remaining
intact for at least ten years. It is important to note here, that it is not
the federal government's responsibility to automatically release a federal tax
lien after it has been paid in full. That burden falls on the taxpayer.
Once you have filed the appropriate paperwork it should take about 30 days
for the government to issue a Release of Notice of Federal Tax Lien. Payment
may be made in cash, check, by approved adjustment, or by submitting a bond
guaranteeing payment within a specified timetable.
In the event the IRS fails to release a Notice of Federal Tax Lien when it
should the taxpayer's only recourse is to sue the federal government. One note
here: IRS employees may not be sued for damages due to their negligence.
From time to time a taxpayer will not file the proper paperwork, and does not
realize that the lien has not been released. When this happens the government
will release the lien in 10 years time, if it has not been resubmitted.
For more information regarding your taxpayer's rights to having your federal
tax lien released contact the Collection Technical Services Advisory (TS) at
1-800-913-6050, or read IRS Publication 4235 for commonly asked questions.
|